ACC Bank has asked the Commercial Court to grant €1.08 million summary judgment orders against businessmen Jay Bourke and Eoin Foyle arising from loans related to The Skylab building in Dublin.
Mr Bourke, Leinster Road, Rathmines, Dublin, and Mr Foyle, Charleville Road, Rathmines, Dublin are opposing the application on grounds including alleged contributory negligence by the bank in failing to engage with their proposals for the buying out of their debt and for purchase of the building on Exchange Street by their business partner, Jan Kohler.
The court was told Mr Kohler, who owns 50 per cent of the building, is not in default on any loans.
Colm O hOisin SC, for the defendants, argued there was no basis for ACC’s “rush to judgment” and contended the bank breached the relevant code relating to lending to small- and medium-sized enterprises. The defendants had the basis for a counterclaim
against the bank on grounds of contributory negligence, it was argued.
Alison Keirse, for the bank, argued none of the issues raised by the defendants amounted to a defence to summary judgment. There was no dispute the loan was made and drawn down and, even if the building was sold, that could take a year and the bank was entitled to summary judgment now, counsel argued.
Mr Justice Kevin Feeney today adjourned the matter to March 18th for the purposes of receiving a report from ACC appointed receiver Declan Taite addressing some of the issues raised. He said he expected to give judgment soon afterwards.
ACC claims some €1.084 million is owed by Mr Bourke and Mr Foyle under a facility letter of May 2008 under which loans were advanced to finance and fit out The Skylab. Repayments were not made under that facility since June 2010 and some €1.084 million was due and owing by both defendants, it said.
Last November, the bank appointed Mr Taite as receiver and manager over the interests of Mr Bourke and Mr Foyle in The Skylab. While The Skylab was a secured asset, the bank said it was unlikely that asset would be realised in the short to medium
term and, when realised, there was likely to be a significant shortfall.
The Skylab was valued at more than €6 million at the height of the property bubble but has “devalued very considerably”, the court previously heard.
In an affidavit on behalf of himself and Mr Foyle, Mr Bourke said he believed there was a bona fide defence to the bank’s claim. He said ACC had advanced funds to refinance his 25 per cent share of the costs of developing and fitting out The Skylab
and had entered into a similar agreement with his business partners in the venture, Mr Foyle and Mr Kohler, with Mr Foyle holding a 25 per cent stake in the property and Mr Kohler holding the remaining 50 per cent.
All the funds advanced to him were secured against his interest in the property, which was developed in 2005, Mr Bourke said. Since then, it was used for showrooms and offices and a substantial part of it was let to O’Hagan Contract Interiors Ltd which has gone into liquidation owing some €70,000 in rent arrears.
Mr Bourke said he had made proposals to ACC to deal with the debt but it had failed to address those in a timely fashion. He had also made clear to ACC he has no unencumbered assets against which ACC could secure any judgment obtained by it.